St James’s Place.

[ZealAndArdour]

Hi,

Just wondering about this company. I understand they’re quite legit and well known.

My dad (not vulnerable, self employed, works still, only vulnerability is my siblings death a few years ago and he lives alone) is very shrewd and has always looked after his assets, saved very hard and tried to make sure we’d all be okay in the future. He’s been using them for several years for various things; consolidating pensions, setting up an asset preservation trust, etc.

But he seems to be in quite regular contact with his advisor (I’ve met the guy to sign paperwork and have some things explained to me, he seems nice enough) and has also received a lot of referred business from my dad making recommendations to friends, etc. The advisor is now taking my dad and some of his pals on quite fancy days out to thank them for the referred custom and just seems to still be very much involved in everything, I thought the things he’d been engaged for were sort of contact-Intense to begin with while they were set up and then might just be yearly reviews of everything. But my dad will still get calls from this guy quite frequently, and he’ll say “oh I’m not answering that, it’s Charles, he probably wants me to invest some more money, he can wait”.

I’m just wondering if this is a normal level of continuous involvement with the financial advisor, I know my dad has good pensions and a respectable portfolio of assets, but unless I’m totally in the dark I don’t think we’re talking millionaire status.

Could there be anything shady going on? Is the financial advisor meant to be in contact this much and taking them out?

My dad would also like me to meet with him to discuss my pensions and assets and tbh I just find the smarming all a bit much, and this level of contact too intense to maintain.

Thanks.

At least we know where to find SJP (in the FTSE 250) whereas BrokerG's whereabouts remain unaccounted for...

SJP have a terrible reputation for high fees. They can seem reasonable but only if you don't know the alternatives and don't appreciate how these fees take thousands and thousands off you in the long term. And their investment results absolutely will not be any better than other providers.

Question, for those better in the know at investing than I am - whenever anyone asks about an IFA on my local mum’s Facebook post, people namedrop their favourite SJP person. But they aren’t actually IFAs, as they aren’t independent? Is that right? Are all IFAs somehow linked to preferred companies, and if not, where is the best place to find a local and actually independent FA?

You raise a question - I do not actually know why they are called “independent.”

FACT: Not all IFAs are linked to preferred investment companies, but many are.

OPINION: Being linked to a preferred investment company is not always bad, but charging higher fees without offering better investment returns IS always bad. SJP has a reputation for doing that.

OPINION: Personally, I would avoid any IFA firm that is listed on the stock market (as SJP is). But that’s just me.

OPINION: unfortunately, the IFA firms that are the best at marketing are more likely to be commercially-driven firms that have a machine to hire and train new advisors to join and sell their chosen investment products.

I have decades of experience as an investor - but no experience as an advisor to individuals. So this post is a mix of fact and personal opinion, as noted above, but it is not financial advice.

SJP are not just ‘linked’ they only sell their own products and others off a panel. They are representatives of a single company, and NOT independent or even a limited market. True Potential are another (example of this poor practice.

Other FA’s can be ‘tied’ - only offering from a limited, preselected limited panel, but not representatives from them.

Independents can sell you anyone’s product in the market. To keep that title we must demonstrate this. We can have deals, we may use some providers more than others, but if a better option appears in the market we are free to take our clients and go there… and I do!

Thank you both, that was helpful.

I get what you are saying, but I just want to be clear on your terminology as your first sentence is incorrect.

IFA stands for Independent Financial Adviser. If an adviser or firm refers to themselves as this they must demonstrate that they are independent. You cannot be a restricted IFA, its an oxymoron.

It is becoming increasingly difficult to satisfy this regulatory requirement meaning that more and more firms operate on a restricted basis, with larger firms being likely to have some degree of vertical integration (offering advice, product and investment) . Restricted is not inherently bad and Independent is not inherently bad.

You are right, I stand corrected.

I always think it’s very well saying you can do in on Vanguard / HL / Nutmeg etc yourself but my view is that:

1. I don’t have time to actively engage and review the investments
2. When I did ‘dabble’ I lost a fair bit with Woodford

I use SJP as unlike independent one man bands I like there is a listed PLC corporate structure and various controls in place. Yes it’s expensive but I’m happy to pay a bit more and have them actively managing my account. I’ve had friends laugh at me for using SJP but my returns have been better than the general market and what I would have done on my own (even with fees). To note I wouldn’t put everything with them, like I wouldn’t for any company.

If I have a question, I can just text the adviser and get a response immediately. Even if this relates to just general wealth management rather than his investments.

Hi. Generally speaking, an SJP adviser is better than no adviser, and I think you are sensible seeking advice rather than 'dabbling' yourself.

All the things that you say they offer are true. There are many happy SJP clients out there, if there weren't, SJP wouldn't be a thing. But they really are being dragged along kicking and screaming by the regulator.

The thing is, other firms can do exactly the same without the opaque and often expensive charging structure that don't place barriers against transferring your product and/or employing a new adviser. Every large business will have quality controls in place, that is not a unique feature of SJP.

You pay your money, you take your choice. I'm glad its working out for you and I hope it stays that way. SJP is almost like a franchise, and there are some good eggs out there and it sounds like you found one.

To be fair to Broker G, SJPs share price is up 134% since that thread and their AUM is at a record of 190bn. Seems like everyone here was wrong and he was right.

@ march2 To be fair to Broker G, SJPs share price is up 134% since that thread and their AUM is at a record of 190bn. Seems like everyone here was wrong and he was right.

It is hovering around the same level it was 10 years ago and even the 5 year high was over 50% higher than it is now.

@messybutfun Regardless, the shares have done better than all the major wealth managers over the last 5 and ten years including Rathbones, Quilter and Schroders. Go figure...

@TheJok since I have nothing better to do on a Saturday night I just had a look at the charts. All the stocks that you mentioned including SJP have gone sideways over 5 and 10 years and none of them have performed well over time.

Hi All, It concerns me of the words/language used by many in this chat, as it shows they do not know the difference between an IFA which stands for an Independent Financial Adviser and an FA which stands for a Financial Adviser.

The difference is substantial, and an FA is generally less value to a consumer as they are restricted to a smaller number of funds and offer less protection (under the Government's Financial Services Compensation Scheme) and diversification than an IFA who is whole of market and has access to all funds on behalf of their clients interests

The article below is a good read that highlights he difference https://www.yodelar.com/insights/gold-standard-of-investing

A good IFA will ensure you are invested across multiple brands to ensure your pension or investment portfolio has full protection under FSCS rules, but if you are with a restricted or FA (not IFA) and invested in the one brand like SJP or Quilter or Royal London you will only have protection up to £85,000.

Hope this helps

That is a new one to me. Splitting someone’s pension into potentially 20 different providers is not something an IFA would do. It would become too cumbersome and costly to manage.

The restricted vs whole market does also not work in practice as you have described. Most IFAs will have a core proposition as we have to carry out due diligence on anything we recommend and it would be impossible to check all providers.

Agreed. I don't think it would be in a clients' best interest, with say, investable wealth of £5m with 59 separate providers. Client money rules provide adequate protection.

On a further point, I'm not sure the relevance of SJP's share price to the services they provide. Opaque, restrictive and excessive charging structures aren't suddenly ok because the share price wen up a few pennies.

Why 20, if I have a pension of 300k, and 2 funds are with L&G because they are the best in North America and say Europe, and 1 with iShares as they are the best in UK, then JP Morgan fund in Global, Threadneedle for Asia, Inveso for Japan etc etc, then I am invested in a portfolio of multiple funds and have multiple protection under various brands up to £85,000 each. Please do not mislead people on this open forum. If you are invested in St James Place or Fisher Investments say you only have protection under the Government Financial Services Compensation scheme up to £85,000 no matter what the value (unless in old style pension schemes), but the scenario I have given using the best funds from various sectors gives protection max of £425,000. More importantly under and IFA (whole of market) I am using the best brands in the various sectors and I am able to maximise potential and maximise protection.

For any investor that is all invested over £85,000 in one brand, say SJP, Fisher Investments, Old Mutual, Close Brothers etc, you can go to Financial Services Compensation scheme website https://www.fscs.org.uk/ and start an online chat, as I have done, and they will tell you directly you are only protected up to £85,000 in the funds of one provider.

From what I see most financial advisers are also not aware of this.

Client money rules do not provide adequate protection, not for my money anyway, maybe for those that do not know any better

I'm not sure you truly understand FSCS or CASS 7 of the FCA handbook actually work. And I'm also not convinced that you have a good understanding of the definition of an IFA and a restricted advice offering.

Not sure that @Sensible1 understands the use of insured funds either, for 100% pension protection.

Nor the potential implications of having all your different funds on one platform.

Nor the fact that SJP do not even manage their own funds. They use external fund managers to put together diversified portfolios consisting of many different investments.

Firstly an old pension product has a 100% pension protection, but not the pension products or investment collectives of today such as a SIPP, ISA or General Investment Account.

Secondly, one platform is not an issue as the monies are with the fund managers not the platform, however it should be noted that a platform itself also offers £85,000 FSCS protection.

Lastly, the funds are named SJP funds, and the funds will fall under SJP if they went belly up, and a consumer investor with more than £85,000 with SJP in a SIPP, ISA or investment account (not bond or old pension scheme) would only be protected up to £85,000 - something I believe the regulator wants consumers to be made more aware of.

I do hope that the recent comments have not come from professionals. I myself am not an adviser, but have completed my own due diligence to ensure I am adequately protected, very few firms do I find for their clients.

Finally if you are a consumer investor reading this thread, I recommend (if are concerned to what extent your investments are protected with a restricted firm like SJP and others) go directly to the FSCS website and chat with their people like I did. Please do carry out your own due diligence - facts not fiction!

🙄

There's a reason why this is a heavily regulated profession with multiple risk warnings on all documents.